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Adware

Software with, often unwanted, adverts

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The software may generate two types of revenue: one is for the display of the advertisement and another on a "pay-per-click" basis, if the user clicks on the advertisement. Some advertisements also act as spyware, collecting and reporting data about the user, to be sold or used for targeted advertising or user profiling. The software may implement advertisements in a variety of ways, including a static box display, a banner display, a full screen, a video, a pop-up ad or in some other form. All forms of advertising carry health, ethical, privacy and security risks for users.

The 2003 Microsoft Encyclopedia of Security and some other sources use the term "adware" differently: "any software that installs itself on your system without your knowledge and displays advertisements when the user browses the Internet", i.e., a form of malware. Some developers offer software free of charge and rely on advertising revenue to recoup their expenses and generate income. Some offer a version without advertising, for a fee.

Types of adware

In legitimate software, the advertising functions are integrated into or bundled with the program. Adware is usually seen by the developer as a way to recover development costs and generate revenue. In some cases, the developer may provide the software to the user free of charge or at a reduced price. The income derived from presenting advertisements to the user may allow or motivate the developer to continue to develop, maintain and upgrade the software product. The use of advertising-supported software in business is becoming increasingly popular, with a third of IT and business executives in a 2007 survey by McKinsey & Company planning to be using ad-funded software within the following two years. Advertisement-funded software is also one of the business models for open-source software.

Application software

Some software is offered in both an advertising-supported mode and a paid, advertisement-free mode. The latter is usually available after buying a license or registration code that unlocks the mode or a separate version of the software.

Some software authors offer advertising-supported versions of their software as an alternative option to business organizations seeking to avoid paying large sums for software licenses, funding the development of the software with higher fees for advertisers.

Examples of advertising-supported software include Adblock Plus ("Acceptable Ads"), the Windows version of the Internet telephony application Skype, and the Amazon Kindle 3 family of e-book readers, which has versions called "Kindle with Special Offers" that display advertisements on the home page and in sleep mode in exchange for substantially lower pricing.

In 2012, Microsoft and its advertising division, Microsoft Advertising, announced that Windows 8, the major release of the Microsoft Windows operating system, would provide built-in methods for software authors to use advertising support as a business model. The idea had been considered since as early as 2005. Most editions of Windows 10 include adware by default.

Software as a service

Support by advertising is a popular business model of software as a service (SaaS) on the Web. Notable examples include the email service Gmail and other Google Workspace products (previously called Google Apps and G Suite), and the social network Facebook. Microsoft has also adopted the advertising-supported model for many of its social software SaaS offerings. The Microsoft Office Live service was also available in an advertising-supported mode.

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